County appeals arbitrators' decisions

July 10, 1994|By John Rivera | John Rivera,Sun Staff Writer

Anne Arundel County has appealed the decisions of two federal arbitrators who ruled that the county violated the firefighters union contract when it increased health care premiums to a level higher than the agreement allowed.

The appeals, one filed Friday and an earlier appeal filed June 29, assert that the arbitrators did not have jurisdiction in the firefighters' grievances because the disputes involved health benefits, part of an employee's compensation, which is a budgetary matter.

Budget decision-making is an area reserved for the elected representatives of county government, namely the county executive and County Council, the appeal said.

County employees won the right to take grievances to binding arbitration when county voters approved a charter amendment in the November 1992 election. But the only disputes that can be taken to binding arbitration are personnel matters, said County Attorney Judson P. Garrett Jr. Those can be heard before the county's Personnel Board, or an arbitrator.

"This isn't a personnel dispute. This is a labor negotiation dispute" involving an employee contract, Mr. Garrett said. Labor disputes between employee unions and the county that result in an impasse are resolved by the County Council, not by the Personnel Board or by binding arbitration.

"I don't agree," said Andrew Kahn, an attorney representing Local 1563 of the Anne Arundel County Professional Firefighters. The firefighters have a provision in their contract stating that an arbitrator can rule on "anything arising out of the labor relationship," he said.

The appeal asks the court to declare a County Council ruling that established the health care plan as final and binding, to set aside the arbitration decision and to establish that the county has the authority to create a reserve fund to pay for its health-care expenses.

The dispute began when county officials, in an attempt to curb the rise in health care costs, revamped

its employee health benefits and offered them three new plans: a health maintenance organization, a network of doctors called "point of service," and a larger and more expensive plan called a "preferred provider network."

The county and the seven unions representing about half its 4,100 employees negotiated for several months last fall, but the county reached an agreement only on the new managed health care system with one union. A labor impasse was declared with the other six unions, and the dispute went before the County Council.

After hearings in March and April, the council ruled in favor of the county. The firefighters then filed grievances and asked for binding arbitration. The union also won a Circuit Court injunction delaying the implementation of the new health care plan until the grievances were resolved.

In the first grievance, the firefighters complained that premiums in the preferred-provider network -- one of three health plans offered to them, with the largest number of doctors and the most expensive to the county -- were to be linked to the rate of increase or decrease of the cost of a smaller and less expensive plan. As a result, their premiums might exceed the 10 percent allowed in their contract.

An arbitrator ruled May 30 that the county cannot charge firefighters more than 10 percent of the health plan's cost.

The second grievance challenged the county's right to raise employee premiums to pay for part of a reserve fund, which would be used to pay for health care claims in excess of what was budgeted. Last month, a second arbitrator ruled in favor of the firefighters.

Arbitrator M. David Vaughn concluded that the county's attempt to build up the reserve fund accounted for a large portion of the 71 percent rise in employee health care premiums since Jan. 1 and violated the union's contract.

Although only the firefighters filed the grievances, most of the other unions have parity clauses in their contracts and are expected to exercise them to win the same concessions.

Last month, County Executive Robert R. Neall canceled 6 percent pay raises for firefighters that were granted to all other county employees, saying that the raises were a "quid pro quo" for agreeing to the health plan. The money that would have gone for the raises was needed to pay for the concessions, county officials said.

The union bitterly complained that eliminating the pay raises will cost each firefighter $2,160 and will save the county $1.2 million. But changing the cost schedule to reflect the arbitration victory will only cost the county $105 for each affected employee, it said.